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Comment by danjoc | Hacker News Reader

>So put the same modem in a cheap phone, or in an expensive laptop, and the IPR will be very different. This is really charging IPR on a lot of value completely unrelated to the modem.

Pot, meet kettle. Apple charges 30% at the App store, whether I want to sell an app for $1 or $1000.

Also, if Apple wanted, they could package the modem separately. Sell it for $50. Again, this mirrors Apple's advice to Samsung to build triangle phones since Apple patented a rectangle with rounded corners. Suddenly, clunky workarounds are bad. Quelle suprise.

I really can't feel sorry for Apple. Live by the sword, die by the sword. Must be nice to be an Apple IP lawyer. They win no matter what happens.

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This story is very Apple vs. QCOM, but I don't care much about this angle really. What I care about is the underlying question: is it ok to charge IPR on value added way outside the scope of the given IP? I don't think so. QCOM does so. Apple is against. So I'm just sympathetic with Apple position in this strong debate and that's it (I'm not even an Apple user).

And I don't feel sorry for Apple. I feel sorry for all the other small manufacturer and companies suffering from this situation, but that are too small to make things move on their own. Apple and Samsung may not have the purest of interest in this debate, but if they move things in what I believe is the right direction, I'll be happy.

Why can't we let the markets regulate themselves?

Or, if we're dictating what's a fair price.. can we at least force Intel, AMD and other relevant parties to license X86 patents?

The difference is that for cellular phones to be effective, they all must use the same standard. Companies agree that for their inventions to be part of the standard, they will license their patents to all comers at FRAND. The patent holders are basically granted a monopoly by the standard setters in exchange for fair licensing terms.

> Why can't we let the markets regulate themselves?

Because this is a synthetic market the government explicitly created and maintained through patent legislation.

>Apple is against.

In this case. Apple has a history of demanding extortionate patent licensing fees for incredibly obvious ideas.

You seem to be missing the bigger picture. The attack on Qualcomm is against the company, not the patents. Qualcomm snapdragons are the only competitive ARM chips against Apple's A series.

Apple is trying to destroy Qualcomm and monopolize the market. That's not going to help the little guys you claim to care so much about.

You're not addressing the poster's point. Does makes sense for Apple to pay a % of total price of phone for one decreasingly relevant part?

Apple A series tech is destroying the Qualcomm's snapdragons just fine without any need for legalities.

Are you suggesting that Qualcomm is using its licensing fees to support an unprofitable Snapdragons? Overall a confusing argument.

>You're not addressing the poster's point.

I already addressed it. The poster is repeating the point. That doesn't make it more valid.

>Apple A series tech is destroying the Qualcomm's snapdragons just fine without any need for legalities.

You might want to review world wide market share numbers before you try to defend that statement.

>Are you suggesting that Qualcomm is using its licensing fees to support an unprofitable Snapdragons?

I'm suggesting Apple is using litigation expense as an avenue to destroy the business of their competitor, again. Apple has much deeper pockets than Qualcomm. It's very simple math.

> Apple has a history of demanding extortionate patent licensing fees for incredibly obvious ideas

When ? I am only aware of one situation in their history i.e. Android where Apple has sought an ongoing royalty.

> Apple is trying to destroy Qualcomm and monopolize the market

What ? Apple is never going to sell their CPUs to their competitors. They are a product company not a components vendor so not sure what market you are referring to. Also Intel sells modem components as well.

Has Apple sought a royalty on Android? My belief has been that Apple refused to license any of their patents. They've sued Samsung not to extract royalties, but to stop them infringing Apple's patents, full-stop.

>> Apple is trying to destroy Qualcomm and monopolize the market

>What ? Apple is never going to sell their CPUs to their competitors.

Who said Apple would sell CPUs to competitors? You don't monopolize a market by having competitors. Not real ones anyway.

I might be able to believe that if Apple were trying to sell the A series chips and compete head-to-head with Qualcomm.

But Apple is not doing that. It is keeping that competitive advantage in house.

Whether you like Apple or not, you have to understand their business model before you criticize it. Apple doesn’t care about competing with component manufacturers. Not even a little bit.

Apple learned this the hard way in the 90s. Don’t compete on price, and don’t compete on specs. Apple happens to be winning on specs right now. The snapdragon procs are not even close to the A-series in performance. But that wasn’t always the case.

This is about maximizing profit. Not about putting anyone out of business.

>I really can't feel sorry for Apple.

And that's exactly where you're looking at this wrong. it's not just Apple that loses out because of this, it's consumer's at large.

Likewise, the same thing happens with apps, consumers must pay more money for apps which will have less revenue to invest in themselves.

That's the thing about unfair economic practices, it never just hurts the people directly involved, but also the massive amount of people indirectly involved.

Apple pays $10 on a $1k phone due to rebates (before the dispute started). Without rebates the cost would be $50. Apple will actually benefit less from a win here than the small phone manufacturer.

>Pot, meet kettle…

Not really equivalent though. Apple advertises and makes the whole app available on the App Store, delivers the whole app from their infrastructure, manages upgrades and back end services for the whole app, provide access to millions of customers and handle the financial transaction for the full cost of the app. It seems reasonable they get a percentage of the whole app’s price.

Meanwhile Qualcomm only own a few patents on a tiny sliver of the circuitry of one component for one function of the device.

You don't have to sell your app in the Apple ecosystem - its very hard to build a modern mobile device without Qualcomm IP.

The stronger argument I think is that Apple did not get its App Store put into a global standard which can't be avoided in exchange for promising to let people sells apps on it under FRAND terms.

Apple can do whatever it wants on its own App Store. It's their device and they aren't a monopoly nor is it anti-competitive for them to charge a high fee on their own store.

But Qualcomm IP is part of the LTE standard on the express condition that they will license their share of LTE mandatory features fairly. I don't think it's fair to take a percentage cut of the whole package price for an IP license that's part of a global standard.

Yeah, that was the unstated subtext of my post.

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